RJ Market Watch
CII seeks relief for gems and jewellery sector
To provide relief to the gems and jewellery industry, the Confederation of Indian Industry (CII) has written to the government, recommending measures, including setting up a fund for artisans, reducing import duty on gold to 2%, a complete waiver of interest on loans and allowing e-commerce for jewellery.
“The impact of COVID-19 on the gem and jewellery sector is drastic as the entire sector has almost come to a standstill due to the lockdown. There is a huge impact on exports of jewellery and diamonds, and for retail, business closure is leading to significant liquidity problems for all players,” CII noted in its recommendations.
The industry body has recommended that a fund should be created to support the workforce in the sector as well as lakhs of Kaarigars in the unorganised sector, under public private partnership.
Further, to mitigate financial distress, the CII has sought 10.5% reduction in import duty of gold to 2%. “This will ensure compliant and organised players overcome the adverse impact due to smuggled gold.”
In addition to the period of lockdown, it has suggested that an additional 90 days from the date of resuming business is declared ‘force majeure’ so that all legal contracts are postponed accordingly. “To reduce cost of operation, we request to extend the interest subvention scheme of 4% to the sector so that the sector can emerge from the financial distress.”
Seeking complete waiver of interest for all loans from banks and NBFCs from the lockdown till 90 days after the business is resumed, the industry body said this will help stem the losses due to the period of lockdown.
To boost demand, CII has suggested that movement of gold should be allowed along with e-commerce for jewellery. They have also sought permit for early resuming manufacturing by organised players on 50% of workforce basis. “Organised players can manage compliance to strict safety processes.”
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